Importance of Last Mile Logistics in eCommerce

From the time of old age goods transfer to the new eCommerce home delivery, last mile logistics plays a crucial role. By chance you made it wrong, your overall eCommerce business is screwed and if it is right, you will gain a lot of customers for lifetime.

Outsource of last-mile logistics

There are cases when your person is unable to do the delivery on time as specified to the customer. It is always good to outsource your last-mile to any certified to third-party logistics providers as it will offer a transactional-style of business relationship. In such cases if your shipment volumes go up or down, the logistics service providers will adjust accordingly, and still you need to pay same price per unit, as decided thus offering a good financial benefit.

Ease your task with Technology

Last-mile delivery also needs a lot of coordination among the product retailers, and its manufacturers. To execute everything without any flaw it is always good to rely on the latest technology. e-Marketers are now investing a lot in technology that will automate several aspects of communication among the people who are involved in the last-mile activities. Currently, e-Retailers have started to send advanced shipping notice electronically to the logistics. The process also allows them to track their product by getting an order-tracking number that they make available to the customers also.

And once the product reaches the local logistics facilities, the system sends automated and even phone call to the customers along with giving the details related to the delivery date and time to the customer. It also offers a three-hour additional time window for delivery. Even after the delivery the system contacts the customers to seek their feedback about the product delivery, like whether it was delivered in time etc.Proper use of information flow and, current physical infrastructure will help in effective last mile of delivery.

Logistics Postponement

It is always good to wait until one has more-accurate order information before shipping, this will help in making more-direct shipments. Generally the service provider uses merge-in-transit technique. So now when a customer places an order, the service provider uses tightly controlled transportation schedule which pick up individual components and merges all components at a consolidation point which is closest to the customer. Then it gets delivered to the customer, without any need of unnecessary transportation.

If the products are bulky and of high value and in case customer demands are fluctuating logistics postponement can be used. The high value of products and uncertainty in customer demands might need considerable inventory, stocked in several locations, which becomes an uneconomical approach. In case the product is bulky, it is good to minimize the shipping distance.


Transfer of materials usually become expensive than information flows as it includes the costs of handling, loading and unloading, shipping, warehouse, returns, and damage. Hence, it is good to substitute material flows with information flows whenever possible, where a physical product is replaced with information. De-materialization can be used in case of products like software, documents, music, videos, publications, and photos etc. Recently, de-materialization is extended to mobile phones also.

Resource Exchange

Pooling resources is common in offline world. Consider a case where company A has lots of demand in case of certain product as compared to that of company B. In such case it is possible that the product become out of stock in the A’s web-store. So to overcome this, A can ask company B to lend its product, thus in turn enjoying the benefits by both A and B, and also achieving customer satisfaction. Thus, in such cases only information has traveled, not the physical product. Resource exchange can be executed by logistics-service providers or eCommerce marketers.

Resource exchange requires company to have access to resources that are widely distributed across different geographical region. Products like flowers fit resource exchange.

Leveraged Shipments

Generally eCommerce web-stores do not get bulk orders from the customers, which mean that the order size will be small. The cost of delivery can be justified only in case there is large number of orders from customers located in close areas. The cost of delivery becomes high if orders are small and distributed over a wide region. Delivery-value density (DVD) will help you to determine whether it is reasonable to deliver goods to different regions in one trip. DVD can be computed by dividing average total volume of shipment per trip by average travel distance per trip. Customers located in the same neighborhood can get deliveries on same day.

When customers trust you and spend money to buy your product, it’s your duty to deliver product on time and free of any damage.

[We are Connecting Dots, a full service eCommerce solutions company. At Connecting Dots, we help companies build great online businesses, we are Magento implementation partners and build great eCommerce portals]